At least three new mobile phone companies have shown interest in setting up their manufacturing plants in Pakistan.
The government of Pakistan’s recent announcement of abolishing the Withholding tax on the manufacturing of mobile phone sets has attracted the companies, producing the same. Amir Alllahwala, the Chief Executive Officer of a company, manufacturing Infinix and Techno mobile sets said, “Now after-tax relation, there is a difference of around Rs.1.900 per $100 device between a locally assembled phone and an imported set.”
The cabinet’s approval for the country’s first-ever mobile device manufacturing policy would benefit the industry. Cheaper mobile sets from all over the world have badly ruined the local market.
An official of the Engineering Development Board (EDB) told the media that three companies have applied for establishing their manufacturing units in Pakistan. Vivo plans to set up its unit in Faisalabad, Airlink is planning to establish its plant in Lahore and Advance Telecom is willing the start its manufacturing activities in Karachi.
The investor will have to obtain the approval of different departments like the Pakistan telecommunication Authority (PTA) and the Ministry of Industries and Production for establishing the manufacturing plants. PTA has issued Mobile Device Manufacturing Regulations 2021.
Important parts of PTA’s regulations are the provisions of details by the manufacture about the land, finances and their Nationality, etc. The PTA regulations direct manufacturers to ensure a comprehensive localization plan which includes complete locally produced packaging for at least 2 % of the local devices manufactured by the company in one year.
The localization plan is to be met by the manufacturers by the end of the second year of installation. It foresees local production of 2 % charges and 1 % of blue-tooth hands-free of total manufacturer devices. Out of the total population of Pakistan, 75 % of people are users of mobile phones. The majority of Pakistanis, especially young people are habitual of changing the mobile set after short intervals. As such, Pakistan is a big market for mobile phone sets.
The step of the government to allow the installation of mobile phone sets manufacturing units will create a big opportunity for jobs as well.